2024-04-09T Armchair Investor Newsletter. The Nasdaq rose a modest 0.3% Tuesday with higher volume for a MINOR ACCUMULATION DAY

2024-04-09T Armchair Investor Newsletter. The Nasdaq rose a modest 0.3% Tuesday with higher volume for a MINOR ACCUMULATION DAY.

I hope many of you had fabulous views of the eclipse – even if on TV.  In Dallas, we had a miraculous clearing of the clouds an hour before our spectacular, full eclipse from start, through the darkness, and back to full sun. Amazing!

Let’s get down to our investing business for Tuesday 4/9/24.

If you have an interest in this longer term look at stockcharts, MarketSurge is a great tool for you. -- I highly recommend it for those investors who want to go to the next level. Go to Investors.com and tryit out! If you understand the importance of really watching the numbers,MarketSurge might be for you!

The chart below is the daily Nasdaq Index chart. Note: Youcan’t buy the Nasdaq composite.  It ismade up of  3,473 stocks. If you can’tbuy it, why do we look at it?  Because itis made up of so many stocks, it is one of the best ways to see how thestock market is doing.  

The Nasdaq is up 27.9% since its October 26, 2023 low.

Next look at the TQQQ (TRIPLE QQQ) CHART below.  Note how close the twocharts seem to have the same profile!  

But the TQQQ is up 87.4%!.....because it is a “triple”!  

Which of those 2 stocks would you rather be in?

(Yes, I know…. The Nasdaq is NOT a stock and you can’t buy it.) TheNasdaq is tracked to understand the health of the market.

And as you look at the TQQQ’s fabulous growth, I hope you understand why I am so invested in the TQQQ,

Note how alike the Nasdaq and TQQQ charts look.

The big difference is the multiple.  The Nasdaq is asingle multiple of that index.  The TQQQis a triple multiple of the QQQ the 100 biggest stocks on the Nasdaq.) Thetwo charts will move in similar looking stepscompared to the QQQ. But each TQQQ step is about 3 times the Nasdaq!

Bottom line: A triple of any stock that is winning isbetter than just the single stock. >>>> But beware of that triplewhen a market reverses. Then the stock will FALL about 3 times as fast.

I am very pleased with the TQQQ’s 5-month growth (almost doubling!) See the upwardheavy line on the TQQQ chart above!

What differences do you see between the Nasdaq and TQQQ charts?  

Yes,they are very similar in form.  

The 3 QQQs, (the single QQQ, the double QLD, and the triple TQQQ) followed the quietmarket in perfect synchronicity. Note the daily rises of the 1x, 2x and 3xfunds, stayed perfectly in sync. And remember… over the longer term, there canbe some variations as there is in the “Gain in 2024” column. My TQQQ are up 87.4%this year and we are just a few days past the first quarter.

>>>>> If the TQQQ has done so well, why am I concerned right now?  Because the Nasdaq and the TQQQ have gone sideways for the last 5 weeks. The IMPORTANT QUESTION YOU HAVE TO ASKYOURSELF:

Is it time to cash out of the TQQQ?  

In an uncertain, flat or falling market, cash can be abetter holding place.  

Look at the TQQQ chart above. What is difference about theTQQQ yesterday from the last 5 months? THIS IS IMPORTANT: Thursday was the first day the TQQQ fell below its50-day moving average line.  

>>> That drop below the 50-day line is enough forme to say the institutional investors are selling their TQQQ….. And that isenough for me to decide I sell my TQQQ and wait in cash… How long?  Until I decide:

·       The market is going into a correction (Downtrend) and I maybuy the SQQQ (the inverse TQQQ)  … OR

·       The market is back in an Uptrend and it is safe to buy backinto the TQQQ

Note Tuesday’s small rises in the 3 Major Exchange Tradedfunds:

LESSON: Don’t be shy to ride a triple in a Uptrend!

But watch it daily. Based on Thursday drop after almost 5sidesways weeks. I will sell my TQQQ at the Friday open unless the open jumpshigher.

>>>Just be sure to watch any triple stock daily soyou can decide when to jump out.  

In a market that is rising overall such as we have had overthe last 5 months, even though there are some short falling or flat periods,step back and note that the TQQQ has been “climbing the hill” – consistently hitting new highs.

·      Those consistent higher highsand higher lows are why I have held on to my TQQQ.

·      But Thursday’s 4.7% drop took it below its 50-day moving average line for the first time

LESSON: Don’t be shy to ride a triple in a Uptrend!

But watch it daily. Based on Thursday drop after almost 5sidesways weeks. I will sell my TQQQ at the Friday open unless the open jumpshigher.

>>>Just be sure to watch any triple stock daily soyou can decide when to jump out.  

In a market that is rising overall such as we have had overthe last 5 months, even though there are some short falling or flat periods,step back and note that the TQQQ has been “climbing the hill” – consistentlyhitting new highs.

·      Those consistent higher highsand higher lows are why I have held on to my TQQQ.

·      But Thursday’s 4.7% drop took it belowits 50-day moving average line for the first time

NOTE: *  A GREEN datebox in the date column above means the Nasdaq hit an all-time highclosing price! Wow!

‍

>>> MY CURRENT ACTION PLAN:  

The Accumulation/Distribution table for the current market is shown below.

The strongest (green) “A” boxes are holding at 14%  from 15% two weeks ago.

Overall, the sum of As + Bs is a strong 60% today, a frequent topping point.

(The above comment is my way of WARNING YOU that the market may have a correction next week, which could grow into a larger drop.)  

I am optimistic about this A.I. driven market continuing to rise. The only way we will know which way the market is moving is to watchthe market….. each day.)

Pink boxes above indicate ratings that have fallen over the last week. Green boxes above indicate ratings that have risen over the last week.

Please consider reviewing this newsletter daily: .The markets can change direction and strength quickly!

Note that the percentage of As and Bs is holding between 58 and 62 for the last 5 weeks!

‍

NOTE THIS WARNING.  Holding onto a falling stock, (whether an ETFor the stock of a favorite company), is a quick way to lose your recent gains.If you play individual stocks and ETF’s, play carefully. Use the real returns(daily, weekly, monthly)

IT IS COMMON FOR STOCKS, ETFs, ANDFUNDS TO FALL FASTER THAN THE RISE.

Of course, I do not sell a positionthat has been rising well after one or two small down days. But if you had asignificant loss over several days, especially if there is an increase inmarket distribution days (down days on higher volume), then stepping outand waiting in cash can help you save your portfolio for future rallies and letyou sleep at night.

REMEMBER:_____EVEN IF CASH IS A VALIDPOSITION,…in a fast rising market, you should VISIT your portfolio to verify it(or a big part of it) is not dropping.

>>>> Stay tuned for Friday’sresults!

One additional “Word to the Wise”…

>>>MOST MARKETS FALLFASTER THAN THEY RISE. Beware of buying any new positions unlessthey are very healthy.

Wishing you big returns in yourportfolio!.

>>>>> I APPRECIATE YOURCONTRIBUTIONS FOR SUPPORTING THIS NEWSLETTER.  

I USUALLY SPEND  MORE THAN 4HOURS FOR EACH ARMCHAIR INVESTOR NEWSLETTER:

·      RESEARCHINGTHE IDEAS IN THIS NEWSLETTER,

·      CALCULATINGALL THE DATA I NEED,

·      WRITINGTHE TEXT FOR THE NEWSLETTER AND….

·      FORMATTINGTHE NEWSLETTER.  (Today it was more like 5 hours.)

I WELCOME YOUR COMMENTS ON THE MINOR CHANGES IN TODAY’S NEWSLETTER (as described in the notes.) 

Thank you for your kind feedback and ESPECIALLY FOR YOU WHO HAVE DECIDED TO MAKE A MONTHY CONTRIBUTION.

Charlotte Hudgin, The ArmchairInvestor  

For active subscribers, my phonenumber is  (214)995-6702

May your stock portfolio grow and growand grow as this giraffe family has!

‍